The Most Positive Thing We've Read About Greece In A Long Time

Eventually, there's only so much an economy can deteriorate before the downward momentum starts to fade a little bit.

Barclays has a note which basically says that the Greek economy -- although ugly and although getting worse -- is seeing a moderation in its downturn. And for the first time, actually, a slight sequential improvement in some numbers.

Elstat released preliminary Q4 12 GDP data. The seasonally adjusted real GDP series contracted by -4.3 q/q (-5.6 y/y) in Q4 12. The cumulative output contraction since the beginning of the crisis has been about 20%, by far the sharpest among euro area economies. Interestingly, when looking at the output composition, investment showed a mild increase in Q4 12 (+1.5% q/q) after a cumulative contraction of 63% (peak-to-trough) since the beginning of the crisis (LHS chart below).

We also saw a slight improvement in economic sentiment indicators in Q4 12 (eg, the sentiment indicator published by an independent local research institute, IOBE, was up by 11.1% y/y). Elstat also released last week the unemployment data for December 2012, which was down to 26.4%, from 26.6% in November (municipal employment programmes that started in December were the main driver).